Planning to take gold loan? Limit tenure to one year to avoid defaults

Those who take large loans for long tenures are the ones most at risk

• As fresh loan disbursements by non-banking financial companies (NBFCs) have slowed down in many segments, they have been  lending aggressively against gold in recent months
• Gold loan is the quickest and easiest to avail. A customer can get it within half an hour if he has the gold and Know Your Customer (KYC) documents ready
• Typically, NBFCs offer higher rates but also longer tenures, and they are more flexible than banks
• They are popular as they come with flexible repayment options, which suit salaried class and business persons
• A borrower